Redx Pharma and Jounce Therapeutics will form one company under the name of Redx Inc., and be listed on Nasdaq, under REDX. The newly merged company will be run by Redx’s existing CEO, Lisa Anson.
The decision for the two biotechs to unite under one banner emerges after Jounce revealed that it would be undergoing a restructuring process, as it did not have the funds required to progress its clinical programs, JTX-8064 and vopratelimab.
Jounce had also stated it expected to reduce its workforce by approximately 57%, and that it would seek business development opportunities for both programs.
Two biotechs merge
The day after the announcement, the merger between the two biotechs was announced. The two companies outlined that Jounce still plans to reduce its employee headcounts, but would bring approximately 47 staff to the new company.
In addition, the newly formed Redx would not pursue in-house development of the two previously mentioned programs, beyond the currently ongoing studies. Instead, the biotech will focus on the development of RXC007, RXC004, and RXC008.
Jounce will bring with it approximately $130m (€123m) in cash and cash equivalents. This will be added to Redx’s existing funds, which allows for a fully diluted market capitalization of $294m. According to the companies, this will provide the combined group with a cash runway into the second half of 2025.
Pulmonary fibrosis, cancer and Crohn's disease
Lisa Anson, CEO of Redx, commented, “By combining Redx’s proven track record in small molecule drug discovery and development with Jounce’s expertise in biologics and immunotherapy, we will establish a world-class biotech company with a robust pipeline, aimed at developing therapeutics for cancer and fibrotic disease. RXC007, our next-generation ROCK2 inhibitor, will lead the clinical pipeline, and we will now further investigate opportunities for this asset in cancer-associated fibrosis and other interstitial lung diseases.”
RXC007 is a ROCK2 inhibitor that is currently going through a phase 2a study in idiopathic pulmonary fibrosis, with topline data expected back from the trial in the first quarter of 2024. According to the company, ROCK2 inhibitors have potential to treat multiple disease areas.
Other than RXC007, RXC004 is being developed as a targeted treatment for wnt-ligand dependent cancers and is also going through phase 2 trials. RXC008 is a gastrointestinal-focused ROCK inhibitor for fibrostenotic Crohn’s disease, which is expected to enter clinical development in the first half of 2024.
